For generations, Hawaii was a place where local families could realistically own a home, pass it down to their children, and stay rooted in the islands their ancestors had lived on for centuries. Today, that dream is slipping away faster than ever before. A toxic combination of mainland and international real-estate investors, short-term vacation rentals, and absentee luxury buyers has turned large parts of the state into what many residents now call “a playground for the rich.”

Here are the core problems Hawaii residents repeatedly cite:

1. Skyrocketing Housing Prices Driven by Outside Money
The median single-family home price on Oʻahu surpassed $1.1 million in 2024, and even “affordable” markets like the Big Island and Maui now routinely see homes sell for $800,000–$1.5 million. A significant share of these purchases are all-cash offers from mainland or overseas buyers who never intend to live here full-time.

Local families earning Hawaii wages (median household income ≈ $92,000) simply cannot compete with buyers from California, Canada, China, Japan, or Australia who treat a $2 million home as a vacation property or an inflation hedge.

2. Explosion of Short-Term Vacation Rentals (Airbnb, Vrbo, etc.)
Despite county-level attempts at regulation, thousands of homes that once housed local families have been converted into illegal or barely-legal vacation rentals. On some streets in Kailua, Waikiki, Kihei, and Princeville, more than 50–70 % of the homes are now investor-owned short-term rentals.

This removes long-term rental units and owner-occupied homes from the market, driving up both purchase prices and rents. The average two-bedroom apartment on Oʻahu now rents for $2,800–$3,500 a month—often more than a local teacher, nurse, or firefighter can afford.

3. Absentee Owners and “Ghost Neighborhoods”
Entire subdivisions—especially newer luxury developments in West Oʻahu, Kona, and Lahaina (post-fire)—sit dark most of the year. Investors buy, sometimes sight-unseen, and visit for only a few weeks. This kills community cohesion, leaves homes vulnerable to break-ins and squatters, and puts extra strain on infrastructure that was planned for full-time residents.

4. Luxury Developments That Cater Only to the Ultra-Wealthy
Projects such as Ward Village (Oʻahu), Kukuiʻula (Kauaʻi), and Hōkūliʻa (Big Island) market multimillion-dollar homes almost exclusively to off-island buyers. Local real-estate agents openly admit that developers give them little incentive to show these units to Hawaii residents because mainland and Asian buyers will pay asking price (or above) in cash.

5. Loss of Agricultural and Hawaiian Home Lands
Investors and hedge funds have been quietly buying up large tracts of former plantation land, especially on Maui and the Big Island. Some parcels were zoned agricultural and were supposed to remain available for local farmers or Native Hawaiian homesteads. Instead, they are turned into luxury “gentleman farms” or held for future resort development.

6. Post-Fire Exploitation in Lahaina
After the August 2023 wildfire destroyed over 2,200 structures and displaced 12,000 residents. Within weeks, real-estate investors—many from the mainland—began cold-calling and door-knocking burned-out families with low-ball cash offers. Governor Josh Green had to declare a moratorium on sales and threaten anti-price-gouging laws to slow the vulture-like behavior.

7. “Investor Flipping” of Leasehold Properties
On leasehold land (common in places like Kailua and Hawaiʻi Kai), investors buy properties just before the lease renegotiation date, knowing the renegotiated lease fee will be enormous. They then flip the home at a massive profit, pricing out the local family that had lived there for decades.

8. Erosion of Local Culture and Sense of Place
When neighborhoods shift from 80 % local residents to 60–70 % vacation rentals and second homes, the fabric of community breaks down. Children grow up without neighbors, community events die out, and the Hawaiian values of mālama ʻāina (caring for the land) and kōkua (helping one another) become harder to practice.

What Locals Are Saying:
– “I was born and raised in Kailua. My parents bought our house in 1978 for $98,000. An investor just paid $2.4 million cash for the house next door and turned it into an Airbnb. My kids will never be able to live here.” 
— Kailua resident, 2024

– “We lost everything in the Lahaina fire. Now we get texts every week from California numbers offering to ‘help us move on’ with cash offers that are half of what our house was worth.” 
— Lahaina fire survivor

– “I make $85k a year as a paramedic. I can’t even rent a studio without a roommate, let alone buy. Every open house I go to is packed with investors paying cash.” 
— Honolulu first responder

Halfhearted Attempts at Solutions (and Why Many Have Failed)
– Honolulu and Maui counties have passed stricter short-term rental laws, but enforcement is weak and investors simply re-register under LLCs or move to unregulated areas.
– Bills to raise the conveyance tax on non-resident buyers or properties over $3–5 million repeatedly die in the legislature, largely because of lobbying from the real-estate industry.
– A 2024 proposal for a 25–50 % “empty homes tax” on properties vacant more than 180 days a year gained traction but was watered down after pushback from wealthy part-time residents.

The Bottom Line
Hawaii is in the middle of an existential housing crisis fueled almost entirely by unchecked outside investment. Without action by local residents to ensure their home sells to local families first, aggressive intervention by dramatically placing higher taxes on non-primary residences, the banning of corperate home buying, iron-clad vacation-rental enforcement, and real protections for disaster victims, and priority for local buyers—the islands risk becoming a luxury resort archipelago with a shrinking local population that can no longer afford to live in the place they call home.

For many kamaʻāina, the fear is no longer that their children will leave Hawaii for better opportunities. The fear is that their children will be priced out and forced to leave the only home they’ve ever known.